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MONTHLY BUSINESS REVIEW of the = Vo1ume 25, No.9 FEDERAL RES E R VE D a11as, Texas, N ovem ber 1, 1940 BANK of Dallas This copy is released for pubIieation in morning papers- 0 ct. 29 ~~~~~~~========================================================================================== DISTRICT SUMMARY year showed gains over a year ago ranging from 7 to 13 per . Trade and industrial activity in the Eleventh District con- cent and the distribution of drugs and tobacco closely approxitinued at a high level during September, reflecting a heavy mated that in September, 1939. Combined inventories of mercommercial demand for products and the letting of additional chandise at reporting wholesale firms were increased moderateGovernmental contracts for National Defense purposes. Em- ly further in September and at the close of the month stocks ployment and payrolls in Texas increased in September and at firms in a majority of individual lines of trade were above the gain in payrolls as compared with a year earlier was the those of a year ago. End-of-month inventories at wholesale largest recorded thus far this year. September department store grocery establishments, however, were 3 per cent smaller than business was near an all-time peak for that month, daily aver- on September 30, 1939. Collections during September on acage sales exceeding those of a year ago by 11 per cent. Whole- counts outstanding at the beginning of the month continued ~ale distribution expanded seasonally, and sales in most report- at a much slower rate than in 1939. Thus far this year the rate ing lines of trade were equal to or above those in September of collections on accounts outstanding has averaged 3 per cent ast year. Consumption of cotton at Texas textile mills re- smaller than that in the first nine months of 1939. Corded a new high for recent years and reports indicate that The expanding volume of business and industrial activity in ~ome mills have a backlog of orders that will necessitate capacthe Eleventh District was reflected in employment and payity operations for several months. Production of crude petro- rolls during September. The Bureau of Business Research of eum and refinery operations expanded sharply, following a the University of Texas reported an increase of 2 per cent in CUrtailment of activity in July and August, and operations employment in Texas over both August this year and SeptemC~osely approximated those of a year ago. Drilling activity con- ber, 1939. Payrolls rose 4 per cent from August to September tinued well above that in 1939. The value of construction and were 8 per cent higher than in the corresponding month Contracts awarded was smaller than a month earlier or a year of 1939. At manufacturing establishments, employment dur~go! but appreciably higher than the average value of awards ing September averaged 6 per cent higher than a year ago and Unng the first nine months of 1940. The outlook for agri- payrolls were up 11 per cent. The number of commercial failures in the Eleventh District cheUltural production continued promising, though rain is needed declined considerably in September and liabilities of defaulting t oughout most of the district. firms were at the lowest level in nearly two years. Dun & BUSINESS . Consumer purchases at reporting department stores in prin- Bradstreet reported 23 insolvencies during the month owing Cipal cities of the Eleventh District continued in heavy vol- a total of $159,000. AGRICULTURE Ume during September, although a smaller-than-average gain Subnormal rainfall during September retarded the growth ;a~ recorded over the large total of the preceding month. ally average sales were 11 per cent higher than in the corre- of late maturing crops in some sections of the Eleventh DisSPonding month of 1939 and on a seasonally adjusted basis trict, and caused a decline in the prospective production of "'ere, with the exception of August, at the highest level for cotton and grain sorghums. Nevertheless, agricultural prosany month since March, 1929. It is significant to note that pects in this district continued very favorable. On October ~e aggregate volume of sales at reporting firms during July, 1, the indicated production of most summer crops, including d UgUSt and September this year was the highest for which corn, rice, grain sorghums, tame hay and peanuts, was well ata are available, averaging 2 per cent above the previous above that of a year ago and the 1929-1938 average harvest. ~eak for that period established in the summer of 1926. TIllS In the greater part of the district crops were so far advanced tk>s seasonally adjusted index of sales stood at 115 per cent that the below-normal rainfall in September had little or no ~o the 1923-1925 average for September as compared with effect upon prospective yields. Harvesting operations made h4 per cent for September, 1939. Cumulative sales of mer- rapid progress during the month. The preparation of soil for ~h an~ise during the first nine months of 1940 were likewise seeding of small grains in the wheat-growing section of Texas e highest in recent years and 4.5 per cent above those in the made generally good progress during September, but planting :mparable period of 1939. Sales at weekly reporting depart- operations were delayed because of dry soil. In some areas S. ent stores indicate that business fell off somewhat in the favored with rainfall during the latter part of September and St half of October and averaged moderately lower than in the first half of October, the sowing of wheat was carried e corresponding two weeks of 1939. CONSTRUCTION CONTRACTS AWARDED ELEVENTH nD[RAL RESERVE DISTRICT b Inventories at reporting department stores were increased t.lIUION! or DOLLARS MILLION5 Of' OOU' ... AS 40 a~ rnore than the average seasonal amount in September, but .so Sill tfe close of the month the value of stocks was fractionally te a ler than on that date of 1939. Collections during SepIIIIllber on open accounts outstanding at the beginning of the 30 1--r---r-~r-~---1---1--~--~---+-I-i30 th 'Were at about the same rate as in September last year. ch he distribution of merchandise through wholesale trade Se anne1s in this district increased seasonally from August to coPtember, but averaged about 6 per cent smaller than in the is rresponding month of 1939. The decline from a year ago "'h~hunted for chiefly by the smaller distribution of groceries, ",.~c evidenced a sharp expansion in September, 1939, when l br kPread speculative buying occurred following the outof 'War in Europe. Sales of automotive supplies, hardre, rnachinery, and surgical equipment in September this th i ",:a This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) MONTHLY BUSINESS REVIEW 2 forward rapidly and reports indicate that the crop is making good growth. Additional rainfall is needed throughout the w hea t-growing terri tory. The indicated production of cotton in the Eleventh District on October 1 was placed at 3,997,000 bales which represents a decline of 3 per cent from that a month earlier. The decline is accounted for by a reduction in the prospective yield in northwest Texas and northern Louisiana. In the latter area dry weather caused considerable shedding of bolls. The October 1 production forecast for Texas was placed at 3,390,000 bales, which is 89,000 bales smaller than a month earlier but still considerably above the 2,846,000 bales harvested in 1939. In Louisiana the cotton crop is estimated at only 450,000 bales, which is 40 per cent smaller than the 1939 production. The indicated production of cotton in the United States showed little change during September, the October 1 forecast being 12,741,000 bales, as compared with a harvest of 11,817,000 bales in 1939. Ginning of cotton in Texas prior to October 1 amounted to 1,481,000 bales, as against a total of 1,968,000 bales in the corresponding period last year. The Texas pecan crop showed a further improvement during September. On October 1 the prospective production amounted to 38,860,000 pounds, or more than double the 1939 harvest. The initial estimates on the production of oranges and grapefruit in Texas from the 1940 blooms are modera tely higher than the final harvests from the 1939 blooms. The condition of livestock ranges in Texas and New Mexico declined in September due to inadequate rainfall. Nevertheless, general range conditions are still favorable in most areas; in fact, conditions on October 1 in Texas and Arizona were above those of a year ago and the ten-year average for that date. Although the dry weather in September caused some deterioration in ranges, it was favorable for the harvesting of feed crops and for the curing of range feeds. Moisture is needed to insure winter wheat pasturage. Livestock are in generally good condition in virtually all areas of the district, and the outlook indicates that cattle and sheep will go into the winter in better-than-average flesh. The demand for livestock was heavy in September, and shipments of sheep from Texas to feeding areas, which had declined in July and August, appear to have risen to an all-time high for the fall marketing season. The Department of Agriculture reports that WHOLESALE AND RETAIL TRADE STATISTICS ~--- Percentagc change in: ..Ratio Sept. ceUeotions Net sales Stooke" to accounts outstandr---------y , ing September 1 r Sept., 1040 from Jon. 1 to Sept., 1040 from rr-~~--_ Sept., Aug., Seprto'm301'0130040 SCpt., Aug., In6tolRetail trade: 1030 1940 fr 1030 1040 Regular ment Department stores: 37.3 Totai llth Dist .. + 7.0 +24.7 4.6 .4 8.6 14.0 - 1.0 +10.3 DaUns.. .. .. .... + 7.7 +23.4 4.4 37.1 16.4 +4.1 +4.2 36.0 Fort Worth ...... + 1.6 +10.4 3.8 10.3 36. 0 + .01 +13.4 Houston .... ..... + 7.6 +44.6 3.0 +10.7 38.6 Son Antonio ..... +14.0 + 8.2 4.0 6.2 11.1 38.4 -4.8 +7.2 Other cities ...... + 1.0 +37.6 10.8 .9 Independent stores:t Amona ......... - 1.8 6.1 New Mexico •.... - 2.7 3.6 + 1.0 Oklahoma ....... - 1.6 .0 Tcxns ........... + 3.4 + 6.8 6.0 Wholesale trade:t Maohinery, eqp't &; supplies (except + 0.0 - . 2 + 6.6 26.8 electrical) ....... + 7.8 -33. 3 Automotive supl's. +13.3 + 7.6 Drugs (inol. Iiqu'rs) - 1.1 +10.2 +'7:7 +":7 +":4 06.6 Eleotrical supplies . - 7.6 - 8.3 + 1.1 +10.0 + 6.2 77 .8 + 6.1 - 3.1 + 6.8 86.6 Groceries ......... -14.1 + 8.4 Hardware ....... . + 7.1 +10.8 + 6.0 + 7.8 - 4.9 61.8 Surgioal eqp't .... . +13.0 + 6.2 ...... +16.0 No ohg. 60.8 Tohaooo&;prod's .. Noohg. Noohg. -.7 02.2 tCompiled by United States Bureau of Census. 'Stooke at olose of month. INDEXES OF DEPARTMENT STORE SALES AND STOCKS (1023-26 nverage= 100) With 8Oasonal adjustment Without 8Oasonal adjustment + + + + + + + + Total Eleventh Dist .. DaUns .............. FortWorth .... ...... Houston ............ Son Antonio ........ . Soles-Sept. 1040 1930 114.8 104.0 120 .3 116.0 123.3 116.6 143 .4 131.9 113.5 94.0 + + Stooke-Sept. 1040 1930 66.4 65.7 60.1 60.8 61.4 60.1 46.8 46 .8 53.9 51.3 + Soles-Sept. 1040 1039 127 .4 115.4 137 .1 122.0 110 .6 JJ3 .0 144.8 133 .2 115.8 06.5 Stooks-Sept. 1040 1930 71.0 72 .3 76.3 76.1 08.2 66.0 61.4 60.8 58.8 55.0 prospects point to an increase in the feeding of cattle in Texas this year, but that favorable prices and a strong demand for animals will be limiting factors. The demand for Texas wool continued strong during September and the first half of October, with prices showing further advances. FINANCE Total earning assets of the Federal Reserve Bank of Dallas declined $4,360,000 between September 15 and October 15, reflecting decreases in investments, in discounts for member banks, and in industrial advances. This bank's participatio~ in the Federal Reserve System's holdings of investment securIties was reduced $3,800,000 during the period as a result of a net reduction in the System's holdings of securities and a reallocation of the investment account among the several Reserve banks. Industrial advances declined $209,000 during the month ended October 15 and discounts for member banks showed a further seasonal contraction of $3 50,000. As compared with a year ago, this bank's total earning assets on October 15 were $7,300,000 smaller. Federal Reserve notes of this bank in actual circulation continued to expand seasonally; the total of $8 9,100,000 -outstanding at the middle of October was $3,800,000 greater than a month earlier and $5,400,000 higher than on the corresponding date of 1939. Member bank reserve balances carried with the Federal Reserve Bank of Dallas showed a noticeable increase between the middle of September and the middle of October, reaching the record level of $230,081,000 on October 15. This expansion resulted in a substantial gain in excess reserves, notwithstanding a noticeable increase in required reserves occasioned by an expanding volume of deposits at member banks. CROP PRODUCTION (In thousands of units) r - - - Telns - - - - v - - Eleventh Distriot---Estimated Estimated Crop Unit Oot. 1. 1040 10aO Oot. 1, 1040 10S0 Cotton.. . . . . . . . . . . . . . .. . Bales 3.S00 2,846 3,007 3.6S 1 Corn.................... Bushels 04.107 73,376 108.478 S7,1~~ Oats.......... . ........ . Bushels 34,376 28.760 37.668 31.3 , Barley.................. Bushels 3,682 2,955 10,664' 10,286 Rioe. . . . . . . . . . . .. .. . . . . . Bushels 16,132 13,088 16,1321 13,0~~ Grain sorghums.......... Bushels 53,844 a8,115 76,264 63'l30 Torno hoy.... .... .. ..... Tons 1,271 1,022 1,686 1, Poanuts . . .. .........•... Pounds 166,060 120,480 203,8051 151,1~~1 Irish potatoes............ Bushels 3,056 2,666 3,763 3,3 I Sweet potatoes.. .. .. .. . .. Bushels 4,428 3.780 11 ,4381 J1'~~~1 Peoans ...... ".......... Pounds 38,860 10,000 61,6241 36, ~ Broomoorn.. ........ .... Tons 3,800 2,200 2S,600+ 17,600 'II .'Texns, Oklahoma, New Mexico and Ari,ona. tTexns only. tTexns Oklahoma nnd NO M~xloo. ITexas, Oklnhoma nnd Louisiana. Other data for Eleventh District derived fro Ill estImates by states. SOURCE: United States Department of Agrieulture. I CASH FARM INCOME FROM THE SALE OF PRINCIPAL FARM PRODUCTS AND GOVERNMENT BENEFIT PAYMENTS (In thousands of dollars) r - - - - July, 1040 ______ Receipts from: Govern- r Total receipts-----31 , ment July July Jon. 1 to Ju IY Crops Livestoek" payments 1940 1939 1040 1oao 26 Arizonn. ...... 2,026 1,169 767 3,942 2,816 31,409 4200'~86 Louisinna...... 706 2,174 603 3,673 4,667 52,671 17'066 New Mexico. . . 1,604 1,666 482 3,641 3,462 21,OaO 00'a03 Oklahoma. .... 16,676 8,027 006 25,008 22,820 00,383 21a4'007 Texas.. . . . . . . . 12,440 18,448 3,087 34,676 31,807 230,700 ~ Total. . . . . 33,441 31,003 0,226 71,020 06,621 'Ineludes receipts from the sale of Iivestoek and Iivestook produots. SOURCE: United States Department of Agrioulture. 444,373 431,600 LIVESTOCK RECEIPTS (Number) r - - - - Fort Worth~ Snn Antonio-----;Sept. Sept. August Sept. Sept. AI"Og4'O 1940 1939 1040 1040 1030 Cattie...... ......... .... 53,661 02,183 46,087 16,621 13,211 I~'n~ Calves.................. 60,376 69,042 37,720 28,034 33,272 1 '4tl Hogs..... . . . . ..• . . . . . . . . 34,338 29,314 30,203 14,152 13.670 11, gO Sheep................... 62,104 80,827 67,270 13,618 7,067 6,8 COMPARATIVE TOP LIVESTOCK PRICES (DoUars per hundredweight) r----Fort Worth~ Son Antonio--;;;t Sept. Sept. August Sept. Sept. A~~40 1040 1030 1041> 1040 1030 6 Beef steers .............. . $10.75 SO.26 $10.60 $8.76 58.26 S~'~O Stoeker steers ........... . 0.25 8.76 0.25 0.00 7.25 '00 Heifers aud yearlings .... . 11.00 10.00 10.00 10.00 9.60 ~'oo Butcher oows ........ .. .. 0.75 0.76 0.60 6.00 6.00 0' 00 Calves ................. . 0.00 0.00 0.00 0.00 8.n O·~ Hogs ..... .. ....... .... .. 7.86 8.26 7.36 7.16 8.00 7'60 Lambs ................ .. 8.00 8.60 8.00 7.76 7.50 . MONTHLY BUSINESS REVIEW Total loans and investments at weekly reporting member banks in leading cities of the Eleventh District expanded further by $14,1 00 ,000 between September 11 and October 9; the total of $546,350,000 on the latter date was $32,300,00 0 greater than the 1940 low recorded on July 10 and $11,500,~OO greater than a year ago. Total loans rose $6,500,000 dur~ng the four-week period, reflecting increases in commercial, Ifldustrial and agricultural loans and in personal advances. This increase was occasioned chiefly by the seasonal demand for funds to finance the customary fall movement of goods ~nd commodities and the general expansion in business and Industrial activity. Total loans on October 9 were at the highest level for that date since 1931. The investment holdings ?f reporting banks, which had shown a downward trend durI~g the first half of the year, have been increased substantially ~Ince mid-July. This increase has occurred principally in holdlOgs of Government direct obligations but there has been a rnoderate expansion in holdings of Government guaranteed obligations and of "other" securities. Total investments on October 9 were $7,600,000 great~r than four weeks earlier and $1,4 00,000 higher th,1ll on the comparable date in 1939. Total deposits at weekly reporting banks expanded $16,700,000 between September 11 and October 9 due chiefly to a further sharp expansion in inter-bank balances. Adjusted dernand deposits on October 9 were only moderately higher than four weeks earlier but they were $26,600,000 in excess of ~hose a year ago. Reserves of these banks maintained at the dcd~ral Reserve Bank of Dallas were increased $3,300,000 UrlOg the four-week period. FOllowing a noticeable downward trend from February through August, the daily average of combined gross demand and time deposits at all member banks in this district reflected a sharp seasonal expansion in September. During that month deposits averaged $1,579,000,000, which was only $1 0,000,000 less than the all-time peak established last February and $92,000,000 higher than the average for September, 1939. INDUSTRY Public and private expenditures in connection with the ~ational Defense Program continued as important factors in t le expanding volume of business and industrial activity in the Eleventh District. The stimulation has been particularly ~Oticeable in the building industry, since large contracts have .cen let for the construction of air bases, army encampments, ~lrcraft manufacturing plants, ship-building yards, and housIng facilities. There has also been some expansion in petroleum refining facilities due indirectly to the defense program. In addition, several manufacturing establishments have been awarded sizable contracts for various manufactured products. The value of defense contracts awarded in Texas prior to Oc~ob~r 1 amounted to approximately $5 0,50 0,000, and reports ndl cate that several large contracts were awarded early in October. .The value of construction contracts awarded in this distriCt during September was 14 per cent smaller than in the p~eceding month when awards were augmented by the letting o Contracts for a large airplane factory in Dallas and by :ards incident to the completion of the construction of the arshall Ford Dam in Travis County, Texas. The value of Septernber awards was also 8 per cent smaller than the 1939 peak recorded in September last year. Despite the declines as comed with the preceding month and the corresponding month 1939, the value of awards issued in September was 8 per cent Ig.her than the average for the first nine months of 1940, ~hlc.h is the highest for any similar period since 1929. Resientlal bUilding showed a pronounced increase in September, ~e ~cting heavy awards for United States Housing Authority crOJects and army barracks. The total value of construction ablltracts awarded during the first nine months of 1940 was OUt one-fifth greater than in the corresponding period of Pfr h' 3 1939. This expansion is accounted for chiefly by a much greater volume of publicly-financed work. The production of crude petroleum in the United States, which had been curtailed sharply in July and August, expanded during September due chiefly to a sharp increase in output in Texas. A 90-day proration order issued by the Texas Railroad Commission late in August provided for allowables CONDITION OF THE FEDERAL RESERVE BANK (In thousanru. of doUars) Ootober 15, Ootober 15, 1940 1989 Total cash reserves. .............................• $280,270 $242,623 Disoounts for member banks....... . . . . .. . ......... 347 40 Other bills disoountod... . . . . . .. . .. .. .. .. . . .. ...• . . 10 90 252 584 Industrial advances ............... , . .. . .. .. ....... Bills bought in the open market. ... . ..... ...... . ... None 10 United States Government seourities........ . ... .... 91,104 98,385 Total earning assots. . . . . .. .. .. .. .. .. .. .. .. .. .. . . . 91,179 99,071 Member bank reserve deposits... . ... ............ . . 230,081 211,278 Federal Reserve notes in ootual oiroulotion . . . ... ...• 89.133 83,701 Sept. 15, 1940 $273,972 697 9 461 None 94,971 90,138 220,951 85,321 CONDITION STATISTICS OF MEMBER BANKS IN LEADING CITIES (In thousonds of doUors) October 9, Ootober 11, Sept. 11, 1940 1939 1940 Total loans and investments. . . . . . . . . . . . . . . . . . . . . . . $540,352 5534.888 $532,212 Total loans.. ....... ........ .. .... ............... 279,080 208,941 272,491 Commeroial, industrial and agrioulturalloan. .. . . .. 185,402 178,818 179,755 Open market paper. . . . . . . . . . . . . . . . . . . . . .. . . . . . . 1,882 1,718 2,074 Loons to brokers and dealers in seourities .... . . . .. . 1,890 2,757 2,049 Other loans for purohasing or oarrying seourities. ... 13,529 13,745 13,634 Reol estate loons.. .. .. .. .. .. .. .... .. .. . .. .. . .. . 23,028 21,590 23,121 Loans to banks.. .. . .. . .. .. .. .. .... .. .. .. .. .. .. 538 411 1,030 All otherloans.. .. .. .......... ................. 52,701 49,902 50,828 United States Government direot obligations... . . . .. . 160,212 154,021 153,880 Obligations fully guaranteed by United States Govt. . 48,246 54,744 48,206 Other seourities. . ... .... .. .. .. .. ...... ........... 58,858 57,132 57,029 Reoerves with Federal Reserve Bonk.... ... . . .. .. .. . 139,010 136,389 136,745 Balanoes with domestio banks...................... 287,580 208,495 287,780 Demond deposits- adjusted·... .. . ..... . ... .. ..•.. 493,414 460,808 490,013 Time deposIts.. . . . . . . . .. . . .. .. .. .. .. .. .. .. .. .. .. . 136,239 134,950 134,904 United States Government deposits... . . . . . . . . . . . . .. 32,018 30,604 31,851 Interbank deposits. .. .. .. .. . . . . .. .. . .. .. .. . . . .. .. . 26Yon8ge 258,802 249,055 Borrowings from Federal Reserve Bank. . . ......... . . N None None ·Inoludes all demand deposits other than interbank and United States Government, less oasb items reported as on hand or in process of coUeotion. DEBITS TO INDIVIDUAL ACCOUNTS (In thousands of dollars) September September Petg. change 1940 1939 over year Abilene................. $ 8,426 5 8,884 - 5. 2 Austin........... ....... 80,090 38,380 -20 .0 Beaumont........ ...... . 21,474 21,411 +.3 Corsioana.......... ..... 3,853 4,129 - 0.7 DaUas........ .......... 235,503 250,017 - 5.8 EI Paso...... ........ ... 20,281 27,651 - 4.0 Fort Worth......... .. ... 72,085 79,005 - 8.1 Galveston............... 22,348 25,470 -12.3 Houstcn.... ............. 235,158 237,801 - 1.1 Port Arthur.. ........... 9,085 8,847 + 2.7 Roswell .. .. . .. .. .. .. .. .. 4,050 4,029 +15.6 70,799 67,762 + 4.5 San Antonio . . . . . . . . . . . . . Shreveport.............. 41,115 43,492 - 5.5 Texarkana·.............. 7,603 8,398 - 9.4 Tueson....... .... ....... 10,105 10,028 - 4.9 10,790 10,798 -.1 Tyler ...... ...... .. ..... Waco . . . . . . . . . . . . . . . . . . . 14,106 15,594 - 9.5 Wiohita Falls............ 14,503 13,800 + 6.1 August 1940 $ 7,885 34,543 21,885 3,130 227,847 26,218 74,594 23,410 230,152 9,890 3,829 70,021 41,152 6,910 10,329 10,853 13,661 15,153 Poovtegr' mcho.nntge ,h + 0.9 -11.1 - 1. 7 +22 .9 + 3 .4 +.2 - 2.6 - 4.6 + 2.2 - 8.1 +21. 0 1.1 -.1 + 9.9 - 2.2 -.0 + 4.0 - 4.3 + $870,106 - 4.2 5831,830 + 1.0 Total. . . .. . ..... $839,249 ·Inoludes the figures of two banks in Texarkana, Arkansas, looated in the Eighth Distriot. GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS (Avcrage of doily figures-in thousands of dollars) Combined total Reserve oity banks Country bonks Gross demand September, 1938 .. ...... . . $1,112,490 September, 1939 .......... 1,255,684 May, 1940 ........ .. 1,346,733 June, 1940 .......... 1,842,691 July, 1940 ... .... ... 1,382,386 August 1940 .... ...... 1,315,554 Septemhc r, 1940 .. ........ 1,340,346 Beaumont .. ............ . Dallas . ..... . .... ...... . EI Poso ............... .. Fort Worth . . . . .. ....... . Galveston ..... ... ..... .. Houston ........ ..... .. .. Port Arthur ....... . .... . San Antonio .. ... ....... . Shreveport ... . ... ...... . Waoo ... .. ............. . Wichita FaUs ....... ... .. All others .. ... ......... . Total. ......... . Time $222,093 231,820 234,507 235,311 234,758 284,123 233,028 Gross demand $031,147 729,063 784,003 782,026 778,481 708,031 783,742 Gross Time demand $122,954 $481,349 128,084 526,981 129,OijO 662,730 129,216 560,506 120,001 553,905 128,963 547,528 128,101 502,004 Time $ 90,739 103,730 106,647 106,095 106,767 106,100 104,802 SAVINGS DEPOSITS September 30, 1940 Percentage change in , --., savings deposits from Number of Number of Amount of , r - - - - - - - , Aug. 31, reporting savings Bavin~s Sept. 30, 1940 banks depositors depoSIts 1939 3 9,800 $ 4,103,360 6.2 .6 - 1.1 90,293 26,218,280 .7 8 18,460 8,241,115 + .7 2 .7 35,167 12,949,074 - 4.9 3 .4 4 19,102 12.338,082. + .6 .4 10 77,194 31,014,708 + 3.9 .2 2 5,998 3,351,671 + 6.4 2.0 22,857 17,721,084 - 1.6 .4 6 3 26,112 12,375,688 + 4.2 .4 8,192 4,031,828 + .2 3 .4 7,235 3,055,745 - 3.7 3 .2 09 01,245 30,098,251 + 2.1 .2 115 880,727 $167,808,802 + + + + + + + + + + + 1.0 No cbg. MONTHLY BUSINESS REVIEW 4 somewhat higher than in the preceding two months and during September allowables for several individual fields were increased further. Daily average production in Texas during September averaged 2 per cent in excess of demand as estimated by the United States Bureau of Mines. In the Eleventh District, daily average production during September was 11 per cent higher than in August but about the same as in September last year. In other sections of the United States production showed little change from August to September but was 13 per cent greater than in the corresponding month of 1939. Following declines in July and August, refinery operations in the United States, as measured by crude oil runs to stills, increased during September and were only inoderately below the all-time peak established in June. As a result of the increase in refinery operations and a higher yield of gasoline from crude oil, stocks of motor fuel declined by a smaller amount than had been anticipated. At the close of September these stocks totaled about 82,400,000 barrels, which was 16 per cent in excess of the heavy supply at that time last year. Inventories of heating oil showed a further seasonal increase, but supplies of fuel oil showed little change over the month, reflecting the heavy industrial demand for that product. Stocks of crude oil have shown relatively little net change during the past two months. Completions of new oil wells in the Eleventh District during September were 9 per cent fewer than in August and in the United States they were down 1 per cent. In comparison with September last year, however, drilling activity was up 16 per cent in this district and 21 per cent in the United States. The rate of activity at cotton textile mills in the United States was maintained at a high level in September. There were 639,300 bales of cotton consumed during the month, which was slightly smaller than in August but 2 per cent VALUE OF CONSTRUCTION CONTRACTS AWARDED (In thou.and. of dollar. ) J an. 1 to September September Augu.t 1940 1939 1940 1040 $187,173 Eleventh Di.triet-total. . . S 22,504 S 24,483 $ 26,242 65,781 Residential. . . . . . . . . . . . 9,045 7,804 8,409 121,392 All other.............. 12,910 10,580 17,833 2,784,352 United Statea·-total.. .. . 347,651 323,227 414,041 1,136,362 Re.idential. . . .. . . . . .. . 152,372 120,680 152,988 1,647,090 All other. . . ...... . . . . . 105,279 10B,547 261,953 ·37 atates east of the Rocky Mountain•. SOURCE: F. W. Dodge Corporation. r Ahilene .. .. ..•. Amarillo .... . .. Au.tin . .... ... . Beaumont ..... . Corr,ua Christi .• Dal as· . ... .... El Paso . ....... Fort Worth ..... Galveston .... .. Houston ........ Port Arthur ... . San Antonio .•. • Shreveport .. ... Waco .......... Wiohita Falls . .. Sept. 30 1930 $154,145 66,467 87,678 2,634,802 1,010,700 1,624,102 BmLDING PERMITS Percentage change Percentage valuation from J an. 1 to Sept. 30, 1040 ohange September, 1040 valuatIon Valuation from 1930 No. Valuation Sept.,1030 Aug.,1040 No. 223 $ 502,538 16 $ 30,330 - 37.1 -76 .4 2.3 -23.5 701 2,032,459 210,294 - 10.4 78 - 6.5 2,454 5,472,844 - 9. 6 310,670 - 10. 2 - 0.1 105 1,232 1,167,027 116,630 + 17.5 +17.4 103 4.0 1,840 7,114,068 +92 .6 213 1,181,089 + 423.3 + 11.4 5,987 11,414,805 +14.5 711 1,626,900 +106.6 +11.8 2,656,173 + 23.3 815 200,842 - 77 .0 -79.2 81 2,362 3,742,370 - 14.9 437,784 + 65 .5 + 9.2 330 1,323 1,696,130 +40.8 112,810 + .3 -67.6 143 4,469 18,102,328 - 0.8 416 1,589,568 - 37 .0 -45.2 1,735 903,400 100,267 - 12 .9 - 2. 2 428 5.1 5,969 5,109,811 +32 .4 451,400 + 8. 0 -33.4 591 1,666 3,957,115 - 7.6 502,326 - 16.5 + 3.8 202 628 1,547,771 +18.4 89,424 - 18 .6 +12 .4 69 411 140,732 2. 2 +20 .8 954,667 +20.7 42 + + + - - ---Total. . .. 3,708 $7,116,075 - + 2 .5 -24. 7 .Includes Highland Park and University Park. 31,815 $66,374,406 + 6.4 CRUDE OIL PRODUCTION-(Barrel.) September, 1940 Increase or decrease in daily average production from Daily avg. Total production production Sept., 1939 Augu.t, 1940 185,038 5,551,150 +42,718 + 27,550 Nerth Texas ... .... .. ..... · .. 7,865,300 262,177 -20,410 + 40,454 West Texa . .. ............. · .. 13,901,200 463,373 -21,153 + 17,301 East Texas .. . ........... .. .. 6,622,700 220,757 - 6,220 + 42,580 South Texas . .. .. ........... . 6,526,650 217,555 -10,618 + 20,824 Tela. Coastal. .. .. ........ .. . Total Texa. . ...... . . New Mexico .. . .. .... ...... .. North Loui.iana ............. . 40,467,000 2,944,200 1,050,200 1,348,000 98,140 65,007 -15,683 +11,050 + 1,934 Total Di. trict. .. .... . 45,361,400 1,512,047 - 2,699 SOURCE: Compiled from American Petroleum In. titute weekly reports. +157,718 3,015 + 434 +155,137 higher than in September last year and the highest for any corresponding month of record. According to reports, roill sales of cotton textiles, particularly unfinished materials and industrial fabrics, exceeded production by a substantial margin, with the consequence that a large backlog of unfilled orders is being accumulated. The heavy demand for textiles, which is attributable to large Governmental orders as well as widespread buying by the trade, has resulted in price advances on a wide range of constructions. These advances, without any material change in raw cotton prices, brought about a further increase in mill margins during September. Domestic consumption of cotton during the first two months of the 1940-1941 season averaged 2.5 per cent higher than the previous record for that period established in the 1927-1928 season. Stocks of raw cotton at consuming establishments and in public storage and compresses increased seasonally in September but remained at a much lower level than a year ago. Exports of American cotton continued sharply curtailed in September, totaling only 90,555 bales as against 644,300 bales in the corresponding month of 1939. During the first tWO months of the current season shipments were less than onefifth the total in that period of 1939 and the smallest for anY comparable period in more than 60 years. The military blockade of western Europe and increased competition from foreign-grown cotton in the remaining accessible world marketS are the principal factors restricting domestic exports. According to the Department of Agriculture, Spain recently contracted for about 100,000 bales of Brazilian cotton at prices 10 to 15 per cent lower than the existing prices of comparable grades of American cotton. Spot cotton prices, which had declined from an average of 10.77 cents per pound for middling, 15/ 16-inch staple, at mid-June to 9.41 cents per pound on September 15, showed relatively narrow fluctuations during the 30-day period ended October 15. The Commodity Credit Corporation reported that 644,000 bales of the 1940 cotton crop had been pledged as collateral for Government loans prior to October 17, of which amount 440,000 bales were in Texas. STATISTICS ON COTTONSEED AND COTTONSEED PRODUCTS Texa. - - - v - - Uni ted Stntes--""""' Augu.t 1 to Se~ember 30 Augu.t 1 to Se~ember 30 a.t season Thi ••ea.on a.t seasOD This .eason Cottonseed received at mills (tons) .... . ..... . . .. . . ..... 303,107 305,846 723,208 1,365,1~~ 675,2 Cottonseed orushed (ton. ) .. ... 166,720 211,802 429,987 Cottonseed on hand Sept. 30 810,544 (tOD.) ... ... .... . ........ .. 152,190 230,612 332,728 Production of produots: Crude oil (pound.) ......... 49,353,755 207,6 66,5J~ 50,841,220 133,740,617 300,6 Cake and meal (ton.) ....... 78,772 100,104 101,623 175.41~ Hull. (tons) .... .. . . ....... 42,408 55.362 10R,980 156,91 Linters (running bales) ..... . 38,258 45,009 102,084 Stock on hand September 30: Crud. oil (pound.) . ...... . . 19,127,074 58,430,7~~ 14,477,521 57,591,774 123,2 Cake and meal (ton.) ....... 34,145 95,884 39,068 Hull. (tons) ..... . .. . .... .. I03,51~ 26,478 42,925 56,693 414,0 Linters (running bales) ...... 43,689 120,561 117,427 SOURCE: United States Bureau of Census. CONSUMPTION, STOCKS AND EXPORTS OF COTTON-(Bales) 0 September September August Au~uat lto September ~n Con. umption at: 1940 1939 1940 ThIS aeason Last sen· 7 Texas mills...... .. .... 16,206 11,115 15,213 31,410 22, 1 United States mills. . . .. 689,252 624,183 654,503 1,203,755 1,254,8 U.S. stocks-end of month: In eon. uming estab'mts . 788,660 868,150 737,062 Public atg. & compresse•. 10,733,787 14,206,343 9,120,201 EXJlorts from U. S. to: 78,418 261,557 United Kingdom . .. . . . . 46,813 125.231 333'40 81, France.. .. .. .. . .. . .. .. None 48,739 None None 58,7~~ Italy ......... . . . ...... None None 45,663 None 18,6 None 416 None None Germany.. .. .. .. .. .. .. 237,1~~ 1,788 Other Europe. . . . . . . . . . 1,308 200,077 480 77,1 10,108 40,152 5,506 51,7 20 18,853 38,124 12,536 10 ra iir~~h~~ ·cou·~t~i~~:.: : : : ~:m Tetal exports . .... . 00,555 ----: 644,328 65,425 155,980 858,869 RECEIPTS, EXPORTS, AND STOCKS OF COTTON AT THE PORTS OF HOUSTON AND GALVESTON-(Bales) SO September September August Au~ust 1 to S.pt~~~D 1940 1039 1940 ThIS season Laa s 5 Reoeipts ...... . . . .... . . . . 317,420 777,207 203,939 521,359 1,05~~'~~6 Exports (for'gn &ooastwi ••) 08,646 381,441 73,163 171,800 ' Siooks, end of month.. ... 1,527,012 1,478,502 1,352,366 .. . . ' MONTHLY BUSINESS REVIEW NOVEMBER 1, 1940 NATIONAL SUMMARY OF BUSINESS CONDITIONS (Compiled by the Board of Governors of the Federal Reserve System) INDUSTR IAL ~6T1 PRODUCTION POINTI IN TOTAt. INDt)( 1t4 TOTAl. INOU 140 120 J TO / 100 eo v J V ) IV \ \ ..... / 60 - 100 80 - /--------'J"..;;:-.:7' tlONOURAOl.E IAANUFAOTURES ~ C\.. 20 ---<i?uRA~ ....../-../ ~r--rIrlAUUfiOTURES 120 60 40 20 MINERAI..S o o 1934 1935 1936 1937 193e 1939 1940 Index of physical volume of production~ adjusted for variation, 1935·1939 average 100. Dura· = b~asonal ~ manufactures, nondurable manufactures, and ~lHn era ls expressed in terms of points in the total Index. By months, January, 1934 to September, 1940. ~U.IONS INCOME PAYMENTS DILLIONS OF OOl.LAR8 OF DOLLAnS 7 A, U V ....,.,.,- r ./ ,..-.. 6 "V ~ 3 1934 1935 1936 1937 1938 1939 1940 D. S. Department of Commerce estimates of the frnount of income payments to individuals, adjusted Or seasonal variation. By months, January, 1934 to September, 1940. "'" WHOLESALE PRICES OF BASIC COMMODITIES 1000~U<rP<I\~:;'~ ~80 eo 6O 140 00 .~ ~ '":::=::==::==~==:::::==:==~=~ 100 40 r eo r---+'=...,...+--!~-A--,\T==t---t--l 80 40 "'"::::--'-_ _.l-_-'_ _..1.._ _'-_...1._---' 40 1934 1935 1936 1937 1938 1939 1940 ~eqeral Reserve groupings of Bureau of Labor StaStICS' data . Thursday figures , January 4, 1934 to October 10, 1940. r~""'OF ~MBER BANKS IN 101 LEADING CIT~ES ONSOFDOI.I.AAS ILLl 10 V .r-l u.s.loo~ .J /' ,....". '2 '0 ....,~ ~Dtg~ '835 '936 '937 '838 1939 ~ednesday fi gures, September 5, 1934, 1 , Changes in output of nondurable manufactured goods and minerals in September were mixed . At wool textile mills activity advanced sharply further to near the peak reached last autumn, reflecting in part expanding production on Government orders. At cotton mills, however, activity showed less than the usual seasonal rise, following a sharp increase in August, and rayon deliveries declined somewhat owing partly to a strike at plants of one large producer. Shoe production also declined in September. Paper production remained in reduced volume following a high rate of output during the early summer accompanying some inventory accumulation at that time. Output of most metals continued large during September. Crude petroleum production, which had been curtailed sharply during the summer, rose considerably, but coal production, which for several months had been maintained at high levels, showed a smaller increase than is usual at this season. Value of new construction work started in September was lower than in July and August, according to reports of the F. W. Dodge Corporation and ehe San Francisco Federal Reserve Bank. The decline occurred chiefly in contracts for defense projects which had been large in the previous two months. Awards for private residential building showed little change from recent high levels. Awards for other private work declined somewhat but continued considerably above the level of a year ago. DISTRIBUTION In September and the early part of October department store sales showed somewhat less than the usual seasonal increase from the exceptionally high level reached in August. Freight-car loadings rose somewhat more than seasonally in September, reflecting to a large extent increased shipments of miscellaneous freight. Loadings of coal, which have been large in recent months, showed less than the usual seasonal rise. COMMODITY PRICES Prices of most industrial materials, particularly lumber, steel scrap, nonferrous metals, hides, and wool, continued to advance from the middle of September to the middle of October, and there were also increases in some manufactured products, notably cotton and woolen goods. Wheat prices were higher while prices of most other foodstuffs showed little change. 4 Commercial loans at reporting member Ibank~ in New York and 100 other leading cities continued to increase during the four weeks ending October 9, reflecting in part scasonal demands. Holdings of United States Government obligations decreased further with the result that total loans and investment's of these banks showed little change. o UNITED STATES GOVERNMENT SECURITY PRICES HER SEW ITIES 4 The Board's seasonally adjusted index of industrial production, which for three months had been at a level of 121 per cent of the 1935-39 average, advanced to about 125 per cent in September. In the durable goods industries increases in output were general. Steel production rose to 93 per cent of capacity, and in the first half of Oc tober the rate was slightly higher as new orders continued in large volume both from domestic and foreign sources. Steel exports amounted to about 20 per cent of ingot-producing capacity in August, the latest month for which data arc available, with nearly three quarters of these shipments going to the United Kingdom and Canada. Activity in the machinery, aircraft, and ship-building industries advanced further in September following considerable increases in August, and automobile output increased sharply as volume production of new model cars was rapidly attained . Plants producing railroad cars and locomotives also showed an expansion in activity. Lumber production continued to rise under the impetus of a growing volume of demand for defense program purposes. BANK CREDIT 6 OANS '3 PRODUCTION liONS 4 DI~(tT AIID OIWW(TUO ' ~? ....... o Volume nf industrial production increased sharply in September, owing mainly to a continued rise in output of durable manufactured products, and this month a f urther increase is indicated. Prices of basic industrial materials advanced in September and the fivst half of October. 1940 to October 940. Commercial loans based on new classification beginning May 19, 1937. Prices of United States Government securities advanced in the second half of September and the first week in October, rising close t~ the high level of the year reached early last April.
@FedFRASER